LEAD: EU increases pressure on Greece to accept bailout terms

Feb 6, 2012, 15:20 GMT

Athens/Brussels - Greece's coalition parties on Monday faced increasing pressure from the European Union to accept tough austerity measures demanded under a bailout agreement, officials said.

Open impatience was obvious from Brussels after weeks of forecasts from Greek politicians that a deal was close to being finalised.

'The truth is that we are already past the deadline' to get a new bailout package agreed, Amadeu Altafaj, spokesman for EU Economy Commissioner Olli Rehn, said in Brussels. 'Greece is a country which has lived for very long beyond its means. The normal consequence of such a situation would have been bankruptcy.'

French President Nicolas Sarkozy called on Greece to 'scrupulously respect' its commitments to international lenders, warning that no time was left.

'The Greeks have made commitments, they must scrupulously respect them. There's no choice, time is running out. It's a matter of days, we have to reach a conclusion now,' Sarkozy said after a meeting in Paris with German Chancellor Angela Merkel.

Prime Minister Lucas Papademos will meet with negotiators from the European Union and the International Monetary Fund (IMF) on Monday. A meeting with the leaders of the three parties backing his coalition, initially scheduled for Monday, has been postponed for Tuesday.

All three parties have publicly opposed to steep cuts in private sector pay demanded by the European Union and IMF.

Meanwhile, the country's two largest private and public trade unions have called a nationwide strike on Tuesday against the new austerity measures, which also include a reduction in the minimum wage, currently at 750 euros.

The head of the National Confederation of Greek Commerce (ESEE) attacked the government for allegedly giving in to pressure from the country's foreign creditors for further wage cuts and labour reforms.

'The red lines in the negotiations turned into red ribbons,' ESEE president Vassilis Korkidis said in a statement.

Athens requires a new 130-billion-euro (171 billion dollar) bailout to avoid bankruptcy next month, when it faces a bond repayment of 14.5 billion euros.

Sarkozy proposed on Monday creating a special bank account to ensure that the bailout funds are used to reducing Greece's debt.

'We propose that the interest on Greek debt be deposited in a blocked account, which guarantees that the debts of our Greek friends will be paid,' Sarkozy said.